Volvo Stops Car Deliveries/Sales In Russia. First Of Many Automakers?Berita Kereta
Both Volvo’s passenger car and commercial truck division have released statements confirming that they would cease all business in Russia following the country’s invasion of Ukraine until further notice.
This would involve the halting of all vehicle sales (Volvo Car AB), deliveries and shipments bound for Russia as well as, in the case of truck-maker Volvo AB, manufacturing within its borders.
“Considering the potential risks associated with trading material with Russia,” Volvo said, “including the sanctions imposed by the E.U. and U.S., Volvo Cars will not deliver any cars to the Russian market until further notice.”
Volvo is therefore the first to impose such a sweeping halt as other sanctions aimed at Moscow take effect, mostly from the United States and the European Union, but it is very likely to be the first of many. Volvo’s expressed disavowal of Russia’s military actions is especially noteworthy given the Swedish automaker is owned by a Chinese conglomerate.
President Xi Jinping of China, while not voicing his support of the conflict, is in opposition to the aforementioned sanctions by the US and EU in reaction to the invasion. He has also been one of the few heads of state that has maintained a close political relationship with Vladimir Putin.
In 2021, Volvo Cars sold around 9,300 vehicles in Russia, which is only approximately 1% of the total passenger cars sold there last year across all automakers. Its sudden absence from the market will likely not impact buyers there, but it shouldn’t be long before other automakers follow Volvo’s lead.
One example of this is General Motors, which sold around 3,000 vehicles last year (a mix of Chevrolets and Cadillacs). They have also confirmed a ceasing of business there, citing external factors including supply chain issues.
Petrochemical giants Shell and BP have also abandoned all their Russian operations, investments, and contracts, including those pertaining to major liquefied natural gas plants, leaving behind projected revenues that measure in the tens of billions of dollars for 2022.
This is a major blow to the Russian economy whose largest export is crude oil. According to The Moscow Times in 2019, the country’s Natural Resources and Environment Ministry estimates that the combined worth of its oil, gas and natural resource production amounts to 60% of its gross domestic product (GDP).
Russia’s stock market has expectedly plummeted following the Ukrainian invasion with much of the financial world rescinding its business dealings with Russian banks, slowly isolating the country on multiple fronts as its military advances on Ukrainian soil.